BATON ROUGE, La. (Legal Newsline) - The Louisiana Supreme Court said it will not rehear a case in which it already ruled that state law does not require a showing of bad faith by an insurer, only proof of notice and inaction for more than 30 days.

The Court majority filed its decision Friday. Justices John Weimer, Jeffrey Victory and Greg Guidry said they would have granted a rehearing.

On Dec. 16, the state's high court reversed the judgment of an appeals court and reinstated the judgment of a district court, awarding nearly $93 million to a group of plaintiffs against their insurer.

The plaintiffs were insured by Citizens in August 2005 when Hurricane Katrina struck and in September 2005 when Hurricane Rita hit.

As a result of the storms, they suffered property damage, which was covered by their policies.

The plaintiffs timely notified Citizens of their losses, but the insurer, they said, failed to comply with its duty to timely initiate loss adjustment as set forth in state law.

Under the law, an insurer -- in the case of catastrophic loss -- "shall initiate loss adjustment of a property damage claim within 30 days after notification of loss by the claimant."

The plaintiffs sought summary judgment.

A district court found in their favor and awarded $5,000 in penalties for each compensable claim, totaling $92,865,000.

The appeals court reversed, finding a factual determination of whether the insurer breached its duty of good faith was required before assessing penalties.

It then fell to the state's high court to review the case and make a determination since the two lower courts were split.

Specifically, at issue was whether an insurer is subject to the penalties imposed by state law for its untimely initiation of loss adjustment in the absence of a showing of bad faith, and whether state law provisions cap those penalties at $5,000 when damages are not proven.

The Court said in its 27-page opinion that it found no error in the district court's award of the statutory cap for each failure to timely initiate.

"It is the insurer's inaction alone that triggers the penalty; no justification or lack thereof on the part of the insurer need be shown," Justice Jeannette Theriot Knoll wrote for the majority in December.

"Requiring the insured to prove bad faith as a prerequisite to the award of penalties as advocated by the Fifth Circuit would, therefore, only serve to interject a requirement not provided in the statute, and seriously interferes with the Legislature's policy considerations for encouraging insurers to timely commence loss adjustment with their insureds."

Under the "explicit language of the statutory provisions," the Court said the $5,000 cap acts as a "ceiling" on the mandatory penalty award for breach of the duty to timely initiate loss adjustment when damages are not proven.

While Citizens argued the circumstances were "beyond catastrophic" and that its advance payments relieved it of liability, the Court did not agree.

The law, by its plain and explicit language, does not allow for any exceptions to liability, even in so-called "super catastrophes," nor does it allow for a showing of bad faith or justification, the Court said.

"Under its mandatory directives, either the insurer timely initiates loss adjustment, or the insurer is subject to penalties," Knoll wrote.